Industry News

Economy falters, mortgage rates dive

Borrowers with adjustable loans may rush refi market

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Mortgage rates dropped this week on news that economic growth came in under expectations, according to surveys conducted by Freddie Mac and Bankrate.com. In Freddie Mac's survey, the 30-year fixed-rate mortgage fell to an average 6.31 percent, down from 6.4 percent last week, while the 15-year fixed-rate mortgage sank to an average 6.02 percent from last week' 6.1 percent. Points, which are fees charged by lenders for loan processing expressed as a percent of the loan, averaged 0.4 on the 30- and 15-year loans. The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 6.05 percent this week, with an average 0.5 point, down from last week's 6.14 percent. The one-year Treasury-indexed ARM averaged 5.53 percent, with an average 0.6 point, down from last week when it averaged 5.6 percent. "Lower-than-expected third-quarter Gross Domestic Product (GDP) figures helped to put a damper on rising rates this week," said Frank Nothaft, Freddie Mac vice president and chief ec...